During the past decade, it has become clear that processing of pre-mRNA, including 5' capping, splicing, 3' end polyadenylation, and even nuclear export, is coupled with transcription by RNA polymerase II (RNAP II). However, the mechanisms linking transcription to processing and how processing regulates transcription are largely unknown. The premise of this proposal is that recruitment and exchange of transcription and processing factors is coordinated with the transcription cycle by phosphorylation and dephosphorylation of Ser2 and Ser5 of the carboxy-terminal repeat domain (CTD), a unique structure present on the largest RNAP II subunit. We will focus on the role of the Ssu72 CTD Ser5-P phosphatase, a component of the CPF processing factor, in trans- cription and how 3' end processing factors affect transcription termination. The research addresses 3 objectives The first objective is to determine where in the transcription cycle Ssu72 acts and to identify specificfactors whose associationwith RNAP II is affected by Ser5-P dephosphorylation. Chromatin immunoprecipitation (ChIP) will be used to evaluate how Ssu72 affects the distribution of RNAP II, transcription factors, and processing factors across transcribed genes in vivo. We will use an in vitro transcription system to test whether Ssu72 facilitates the initiation-elongation transition. Our second objective,which is addressed in two aims of the proposed research, is to understand how Ssu72 is regulated by the RNAP II transcription machinery and by 3' end processing factors. We will determine whether transcription factors that genetically interact with Ssu72 affect CTD Ser5-P levels and the distribution of RNAP II Ser5-P across genes. A powerful combination of yeast genetic methods will be used to identify novel factors that interact with Ssu72. We will also test the hypothesis that the interactions of Ssu72 with CPF, and of the 3' end processing complex with the CTD, are important to direct Ssu72 activity to the phosphorylated CTD. Our third objective is to determine the role of the cleavage/polyadenylation machinery in poly(A)-dependent termination. There is much debate over the molecular events that lead to termination, including whether the processing factors must contact RNAP II, whether cleavage of the nascent transcript is important, and whether degradation of the transcript downstream of the cleavage site is needed. We will use ChIP analysis, a modified transcription run-on assay, and a strategy that allows the examination of lethal mutations to address these issues. The proposed experiments build upon our long history of using biochemistry and genetics to successfully study transcription and mRNA 3' end processing. We anticipate that these new studies will advance our insight into the dynamics of the transcription cycle and identify and clarify critical checkpoints in the early and late phases of this cycle. Moreover, RNAP II transcription and RNA processing are highly conservedprocesses, orchestrated by phylogenetically similar proteins. Consequently, we expect that information gained from our proposed studies will be directly applicable to human biology and medicine.